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Old 01-25-2013, 08:35 AM
 
Location: Cape Coral
5,503 posts, read 7,293,408 times
Reputation: 2249

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Old 01-26-2013, 05:06 AM
 
71 posts, read 104,746 times
Reputation: 76
Be careful with that, real estate is doing it much better than formally years, that's true.
But it's better to grow slowly and sustainable and that is what lacks, sustainable.

What i saw is significant. Like i already told here i am interested in buying a home as well.
But last year or better late 2011, i was there to find something in the Pelican area. I found some nice houses (they are all nice over there)!almost! But there was one in which i felt in love. Unfortunately
i faced trouble to sell my lot in Europe, so i couldn't buy it. The house was priced around $119000.

When i want the same house now i should pay almost $200000, sometimes houses older than that one, but sometimes upgraded as well (pool, tile floors,...) In one year such an increase???
Ok listing prices are may be not what they should get for real, but it strikes me that many people keep on dreaming and so trying to list their property that high. How much people in are there still
under the water now? Something is telling me that they try to sell it and maybe want to take some loss.

How much shadow inventory is there still not on the market while it in fact should be on the market?
May be the banks can afford it to hold more houses from the market because of the low rent to borrow money. Until that keeps going on, prices will continue to rise, but this indicates a new bubble.
They try to keep the inventory low, so that looks that it is really a good opportunity and so prices follow to go up. Once the rent will increase there will be another flood of houses on the market. So i hope there are enough investors to buy and keep on buying.

Otherwise it is a good time to buy now because the show will go on a little more further, but there are really signs of a new bubble. The house i talked about is only 8 years old and it has already got 6 different owners. This looks unsustainable for me. I want to buy it for the long term because i plan to move to USA.
But too many investors have not that plan, so once they have made enough profit, they sell it.
It seems that Cape Coral has become a play ball for investors or people who don't want to know what a house is, in fact a place to live in and not a gamble for making profit. It's not bad that housing-prices are
increasing, but it is bad that they increase that much. Sooner or later there will be correction.
Definitely when wages are decreasing,prices rising sometimes 40procent since the massacre.

I hope i have it all wrong.
 
Old 01-26-2013, 06:41 AM
 
Location: Cape Coral, FL
158 posts, read 379,063 times
Reputation: 133
Did you see this house--inside and out--when it was $119k and have you seen it since it is $200k, or have you just seen it just on the Internet? My guess is that an investor bought it when it was low, put in a lot of improvements, and now wants to make a profit--that is what is normally the case when you see a drastic increase in prices over a short period of time. (You might see if any permits were pulled during that time on the house for a clue as to any major work that was done).

I believe you are "over thinking" the situation. Nobody knew prices would skyrocket in SWF, nobody new the prices would crash, and nobody knows what will happen tomorrow. Don't worry about "the one that got away"--that's ancient history; unless you are buying as an investor just concentrate on finding something that you will be happy with no matter whether the market increases or decreases.
 
Old 01-26-2013, 10:43 AM
 
71 posts, read 104,746 times
Reputation: 76
Quote:
Originally Posted by xoomer View Post
Did you see this house--inside and out--when it was $119k and have you seen it since it is $200k, or have you just seen it just on the Internet? My guess is that an investor bought it when it was low, put in a lot of improvements, and now wants to make a profit--that is what is normally the case when you see a drastic increase in prices over a short period of time. (You might see if any permits were pulled during that time on the house for a clue as to any major work that was done).

I believe you are "over thinking" the situation. Nobody knew prices would skyrocket in SWF, nobody new the prices would crash, and nobody knows what will happen tomorrow. Don't worry about "the one that got away"--that's ancient history; unless you are buying as an investor just concentrate on finding something that you will be happy with no matter whether the market increases or decreases.

I saw the house from inside when i was there. Everything was nice and clean did not really need any improvements. Now, i can't see it from the inside but everything looks still the same.
Maybe it is because of the age of house, only 8 years old and situated on chiquita near cape harbor.
 
Old 01-26-2013, 10:46 AM
 
71 posts, read 104,746 times
Reputation: 76
Can you explain why i should stay in Europe?

Last edited by Sunscape; 01-30-2013 at 04:46 PM..
 
Old 01-26-2013, 11:17 AM
 
Location: Florida Space Coast
2,356 posts, read 5,061,305 times
Reputation: 1571
I agree that the 20% year over year increases the past 3 years is not sustainable but I disagree that this is a new bubble forming. The house that I own sold for $260k in 2006 brand new never lived in. It dropped in price and I was able to pick it up for $85k. so if you added 20% (roughly 17k per year for 3 years) that would give you a value of $136k (which is real close to what I think I could get for the property today). anyway the house that sold for $260k crashed because it was not worth that at the time. but the replacement cost is roughly $200k so if you take into consideration replacement cost, plus what rents will fetch, what the median income is to afford an 90% ltv mortgage it is likely that the house should go to $175k -$200k. I have little to no doubt this is where prices are headed around April- June of 2015 from there it should level off to a normal 3-5% year over year appreciation. If you see it blow by the $200k mark w/o slowing down then yes you will have the makings of another bubble. The other thing to consider is 65% of all buyers are cash buyers . this is 2x the amount of normal cash buyers which indicates that if and when "leverage" comes back into the market (which it slowly is) and unemployment levels continue to decrease, and baby boomers continue to retire and choose areas such as florida for the weather and tax protection then this area should continue to do very well.

2015 will be the interesting year because when the year over year increases slow down then some investors may look to lock in profits and sell. However as values increase they should be able to command higher rents and if they are getting 15% rate of return with positive cash flow then why sell a winner?

Any matrix that I use points to this market being undervalued still by about 35%. so Yes I think it is still a good time to buy. I think if you are waiting on the sidelines for a correction you may be disappointed.
 
Old 01-26-2013, 01:13 PM
 
71 posts, read 104,746 times
Reputation: 76
Quote:
Originally Posted by nhkev View Post
I agree that the 20% year over year increases the past 3 years is not sustainable but I disagree that this is a new bubble forming. The house that I own sold for $260k in 2006 brand new never lived in. It dropped in price and I was able to pick it up for $85k. so if you added 20% (roughly 17k per year for 3 years) that would give you a value of $136k (which is real close to what I think I could get for the property today). anyway the house that sold for $260k crashed because it was not worth that at the time. but the replacement cost is roughly $200k so if you take into consideration replacement cost, plus what rents will fetch, what the median income is to afford an 90% ltv mortgage it is likely that the house should go to $175k -$200k. I have little to no doubt this is where prices are headed around April- June of 2015 from there it should level off to a normal 3-5% year over year appreciation. If you see it blow by the $200k mark w/o slowing down then yes you will have the makings of another bubble. The other thing to consider is 65% of all buyers are cash buyers . this is 2x the amount of normal cash buyers which indicates that if and when "leverage" comes back into the market (which it slowly is) and unemployment levels continue to decrease, and baby boomers continue to retire and choose areas such as florida for the weather and tax protection then this area should continue to do very well.

2015 will be the interesting year because when the year over year increases slow down then some investors may look to lock in profits and sell. However as values increase they should be able to command higher rents and if they are getting 15% rate of return with positive cash flow then why sell a winner?

Any matrix that I use points to this market being undervalued still by about 35%. so Yes I think it is still a good time to buy. I think if you are waiting on the sidelines for a correction you may be disappointed.

Thank you for your honestly explanation. The market was in 2010 underrated and maybe that could be why they go hard up right now. I just don't trust banks and in the past it was clear they played with us.
Nobody knows how much houses there are still in repossession + how many there will still come in repossession. As long as there are enough investors there's no problem, only for the people who faced a huge loss. But if they keep on rising that fast, then i'm sure that there will come a correction.
Also i don't believe healing debt with making more debt is the solution for the problem.

Otherwise, this location is great and so it will be safer than other cities if other problems head up.

Sorry about my English, i still try hard to get better with it, but when your native language is another one, it can be hard sometimes.
 
Old 01-27-2013, 09:17 AM
 
Location: Long Island, NY & The Somerset at the Plantation, Fort Myers, FL
95 posts, read 212,657 times
Reputation: 71
Quote:
Originally Posted by wallstreet84 View Post
Thank you for your honestly explanation. The market was in 2010 underrated and maybe that could be why they go hard up right now. I just don't trust banks and in the past it was clear they played with us.
Nobody knows how much houses there are still in repossession + how many there will still come in repossession. As long as there are enough investors there's no problem, only for the people who faced a huge loss. But if they keep on rising that fast, then i'm sure that there will come a correction.
Also i don't believe healing debt with making more debt is the solution for the problem.

Otherwise, this location is great and so it will be safer than other cities if other problems head up.

Sorry about my English, i still try hard to get better with it, but when your native language is another one, it can be hard sometimes.

Your English is excellent and welcome to beautiful SouthWest Florida! I'm certain you'll find the perfect place.
 
Old 01-27-2013, 02:22 PM
 
71 posts, read 104,746 times
Reputation: 76
Quote:
Originally Posted by prairie360 View Post
Your English is excellent and welcome to beautiful SouthWest Florida! I'm certain you'll find the perfect place.
Thank you, i'm glad to hear that. Yes, SW Florida is a very nice place. I really like it, especially the weather,
the people, the silence and the space. Once i'm in it will be a huge difference with the place i live now, which is Brussels, or better near to Brussels. Here it is very cold, rainy not as much sunshine so very short summers. Very small, so sometimes very claustrophobic feelings.

Europe is nice to visit, but not to live in. Biggest + is that we sometimes have more days-off compared to Americans and may be in some parts of the continent at least in my country, we have a better social secure system. But this is absolutely unsustainable in the future with the created debt and the lack of economic progress. So soon it will be not as good as it used to be. Job creation is the same as you have and that seems not as good but i believe that the USA will at least make more progress than Europe.

The biggest + in the USA is that i can buy a property much cheaper than here. For a small house build in the
30s (only 130sqf) i should pay approximately 250k in euros, compared to $ this makes 337500 which is a lot of money. Even with a low amount of jobs, i am sure that i can find work.
 
Old 01-30-2013, 12:14 PM
 
71 posts, read 104,746 times
Reputation: 76
The market looks really good! Some people already asking 20% more than the average prices in the near neighborhood.
Seems that a correction is looming. Although, they that have bought in 2010 did a pretty good job. But buying at this moment
can mean: burning your hands. However some increase is still possible, this will not last.

I hope that i will be wrong, but those who say; 'This is the best time to invest in housing"
Did the same thing at the top of 2007 as well. I hope i have it all wrong.
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